EUR: EUR/USD - Support Just Below 1.1400 Holds For Now

• Those still holding reservations about the growing strength of China's economy may be revisiting their view on rates as May's export numbers topped expectations.
• May exports jumped +19.4% YoY in USD terms topping the April expansion of +14.1%
• Imports surged also up +27.4% above April's expansion of +25.3%
• Exports to the US jump +35.6% YoY to US$39bn whilst Imports from the US rose +20.2% to US$13bn.  The accompanying trade surplus widened to US$26bn from $23bn in April.
• China's export sector, driven by surging global demand for high-tech products, is expected to remain robust in the second half, which will provide strong support for the country's economic growth as the recent thaw in trade relations between China and US could help reduce uncertainty over external demand in the months to come.
• A surge in shipping costs between China and US points to the ongoing strength of demand for trade between the world's two biggest economies.  
• From a country perspective imports were relatively consistent from the month prior with goods from South Korea topping US$26bn as the AI boom permeates throughout the region.  
• The strength in exports is likely to continue into the near term and pushes out any expectations for monetary policy changes.  We see limited likelihood for monetary policy changes in Q3, with fiscal policy the main tool for supporting growth for now.   

Australia’s “misery index” began to improve in 2023 and continued until mid-2025 but it then began to deteriorate with the pickup in inflation, which was partly due to base effects from the expiry of government electricity rebates but also rising price pressures as demand exceeded supply. How consumers perceive labour market conditions and inflation impacts their overall sentiment even though it can sometimes be with a lag. Therefore, it was unsurprising that seasonally-adjusted Westpac consumer confidence began to deteriorate even though it wasn’t until January but before the onset of the Iran War and associated fuel price rise. Labour underutilisation had also started trending higher. In June Westpac noted that cost-of-living concerns remain at the fore and so confidence also remained lacklustre. Unemployment expectations were stable but above the historical average.

Australia misery index vs consumer confidence

Source: MNI - Market News/LSEG

Below is a selection of key recent onshore media highlights for China ICYMI :

Infrastructure Spend (China Daily): Mega dam expansion to boost Yangtze economic belt

https://www.chinadaily.com.cn/a/202606/09/WS6a26f9aaa310d6866eb4d17f.html

US Trade (China Daily): US-bound container prices surge

https://www.chinadaily.com.cn/a/202606/09/WS6a275778a310d6866eb4d1d7.html

Exports (China Daily): 'Remarkable resilience' seen in China's exports

https://www.chinadaily.com.cn/a/202606/09/WS6a276e64a310d6866eb4d277.html

Urban Renewal Financing (China Daily): Fiscal funds, bank loans both seen helping finance urban renewal drive

https://www.chinadaily.com.cn/a/202606/09/WS6a2767ada310d6866eb4d212.html

Industrial Output (China Daily): Supply continues to expand; industrial structure sees faster upgrading

https://www.chinadaily.com.cn/a/202606/09/WS6a2767ada310d6866eb4d212.html

Financial Sector Regulation (China Securities Journal): State Financial Regulatory Commission: Resolutely Advance Strict and Strong Regulation 

https://www.cs.com.cn/xwzx/01/2026/06/09/detail_2026060910016885.html

Interest Rate Liberalization (China Securities Journal): Promoting Interest Rate Marketization Reform to Make Financial Pricing Fairer 

https://www.cs.com.cn/xwzx/jr/2026/06/09/detail_2026060910016884.html

Global Capital (China Securities Journal): China's capital market enters a new stage of high-quality development.

https://www.cs.com.cn/xwzx/01/2026/06/09/detail_2026060910016882.html

North Korea (Xinhua): Xi, Kim hold talks in Pyongyang, pledge to advance China-DPRK ties

https://english.news.cn/20260608/0a428079d41f4cb2b500ebf31bef58c7/c.html

Industrial Output (Xinhua): China's industrial robots reshape smart manufacturing

https://english.news.cn/20260608/f96cda0296c343588a6814c498fc3628/c.html

Real Estate (Securities Daily): China Rental Market Shows Signs of Stabilizing

http://epaper.zqrb.cn/html/2026-06/09/content_1249671.htm?div=-1

Bond Issuance (China Securities Journal): Fiscal Push to Accelerate China’s Local Bond Offers in June

https://epaper.cs.com.cn/zgzqb/html/2026-06/09/nw.D110000zgzqb_20260609_6-A02.htm

https://www.mnimarkets.com/articles/mni-china-press-digest-june-9-economy-fuel-tax-competition-1780970448439